Central Electricity Regulatory Commission

New Delhi

Coram:
Shri P.K. Pujari, Chairperson
Dr. M.K. Iyer, Member
Shri I.S. Jha, Member

File No. L-1/44/2010-CERC Date: 23rd April 2019

Statement of Reasons

In the matter of

Central Electricity Regulatory Commission (Sharing of inter-State Transmission

Charges and Losses) Regulations (6th Amendment), 2018

1. Introduction:
1.1. The Commission vide notification dated 27.4.2018 issued the Draft Central
Electricity Regulatory Commission (Sharing of Inter State Transmission Charges
and Losses) (Sixth Amendment) Regulations, 2018 (hereinafter referred to as the
“Draft Sixth Amendment to the Sharing Regulations” or the “Draft Amendment”)
along with Explanatory Memorandum seeking comments/ suggestions/
observations from the stakeholders/public. The Central Electricity Regulatory
Commission (Sharing of Inter State Transmission Charges and Losses)
Regulations, 2010 is referred to as the Sharing Regulations.

1.2. Comments were received from 8 stakeholders including DISCOMs, renewable

energy generators and associations. List of stakeholders who submitted written
comments is given at Appendix-I. The detailed comments are available on the
website of the Commission at www.cercind.gov.in. After due considerations of the
comments/ suggestions/ objections received, the Commission has finalized the
Draft Sixth Amendment to the Sharing Regulations.

1.3. The amendments proposed in the draft regulations, deliberation on the

comments/suggestions offered by the stakeholders on the proposed amendments
and the reasons for decisions of the Commission are given in the succeeding
paragraphs. While an attempt has been made to consider all the
comments/suggestions received, the names of all the stakeholders may not

1 Statement of Reasons to the 6th Amendment to the Sharing Regulations

 appear in the deliberations. However, the name of all the stakeholders is enclosed
as Appendix-I.

2. Waiver of ISTS charges and losses for wind and solar projects
2.1. A new Sub clause (aa) was proposed to be added after Sub clause (z) to Clause
(1) to Regulation 7 of Principal Regulations as under:

"(aa) No transmission charges and losses for the use of ISTS network
shall be payable for the generation based on solar and wind power
resources for a period of 25 years from the date of commercial
operation of such generation projects if they fulfill the following
conditions:

(i) Such generation capacity has been awarded through competitive

bidding;

(ii) Such generation capacity has been declared under commercial

operation between 13.02.2018 till 31.3.2022;
(iii) Power Purchase Agreement(s) have been executed for sale of
such generation capacity to all entities including Distribution
Companies, for compliance of their renewable purchase
obligations

2.2. The date “31.12.2019” in sub clause (y) to Clause (1) of Regulation 7 was
proposed to be substituted with the date “12.2.2018”.

2.3. The date “31.3.2019” in sub clause (z) to Clause (1) of Regulation 7 was proposed
to be substituted with the date “12.2.2018”

2.4. The Commission had given following rationale while proposing the above
amendment:
“(1) Tariff Policy notified by Ministry of Power dated 28.1.2016 provides, at para
6.4 (6), as follows:
"In order to further encourage renewable sources of energy, no inter-State
transmission charges and losses may be levied till such period as may be
notified by the Central Government on transmission of the electricity
generated from solar and wind sources of energy through the inter-state
transmission system for sale."

2 Statement of Reasons to the 6th Amendment to the Sharing Regulations

(2) In this regard, Ministry of Power had, vide Notification dated 30.9.2016
regarding ISTS charges and losses for solar and wind based projects, notified
as follows:

"(i) For generation projects based on wind resources, no inter-state

transmission charges and losses will be levied on transmission of the
electricity through the inter-state transmission system for sale by such
projects commissioned till 31.3.2019.

Provided that the above waiver will be available for a period of 25 years
from the date of commissioning of such projects;

Provided further that such waiver will be available only for the projects
entering into Power Purchase Agreements (PPAs) for sale of electricity to
the Distribution Companies for compliance of their renewable purchase
obligation;

For generation projects based on solar resources, no inter-State

transmission charges and losses will be charged for use of inter-state
transmission system (ISTS) network by such projects commissioned till
30.6.2017 as per the CERC (Sharing of Inter-State Transmission Charges
and Losses) (Third Amendment) Regulations, 2015.

Provided that this waiver will be available for a period of 25 years from the
date of commissioning of such projects;

Waiver will be allowed only to those solar and wind projects that are
awarded through competitive bidding process."

(3) Vide order No. 23/12/2016-R&R dated 14th June, 2017, Ministry of Power has
modified the earlier order dated 30.9.2016 to extend waiver of ISTS
transmission charges and losses for generation projects based on solar
resources commissioned till 31.12.2019. The relevant portion of the said order
dated 14.6.2017 is reproduced as under:

“Ministry of Power, in consultation with various stakeholders, hereby modify

its order of even number dated 30th Sept., 2016 as under:

1.0 Para 3 (ii) of the aforesaid order be read as under:

For the generation projects based on solar resources, no

transmission charges and losses will be charged for use of interstate
transmission system (ISTS) network by such projects commissioned
till 31.12.2019.

Provided further that the above waiver shall be available for a period
of 25 years from the date of commissioning of such projects;

Provided further that such waiver will be available only for the
projects entering into Power Purchase Agreements (PPAs) for sale

3 Statement of Reasons to the 6th Amendment to the Sharing Regulations

 of electricity to the Distribution Companies for compliance of their
renewable purchase obligation;

2.0 The other terms and conditions of order No. 23/12/2016-R&R dated
30.9.2016 shall remain applicable.
….”

(4) Accordingly, the Commission vide notification No. No.L-1/44/2010-CERC

dated 14th December, 2017 notified the 5th Amendment to the Sharing
Regulations whereby waiver of inter-State transmission charges and losses on
transmission of electricity was extended for the projects based on solar and
wind resources. The said waiver was available for solar based projects
commissioned/ to be commissioned between 1.7.2017 and 31.12.2019 and for
wind based projects commissioned/ to be commissioned between 30.9.2016
and 31.3.2019. The waiver was available for a period of 25 years from the
date of commissioning of such projects and was only for the projects awarded
through competitive bidding process where PPAs have been entered for sale
of electricity to DISCOMs for compliance of their Renewable Purchase
Obligation (RPO).

(5) Further, vide order No. 23/12/2016/R&R dated 13th February, 2018, Ministry of
Power has extended waiver of ISTS transmission charges and losses for
generation projects based on solar and wind sources of energy commissioned
till 31.03.2022 in supersession of its earlier Order No. 23/12/2016-R&R dated
30th September, 2016 and Order No. 23/12/2016-R&R dated 14th June, 2017.
The relevant portion of the said order dated 13 th February, 2018 is reproduced
as under:

“4.0 In supersession of Ministry of Power order No. 23/12/2016-R&R dated

30th September, 2016 and Order No. 23/12/2016-R&R dated 14th June, 2017,
it is hereby notified that-
i. For generation based on solar and wind resources, no interstate
transmission charges and losses will be levied on transmission of
electricity through the inter-state transmission system for sale of power
by such projects commissioned till 31st March, 2022.
Provided that the above waiver wall be available for a period of 25
years from the date of commissioning of such projects;
Provided further that above waiver will be available only for solar and
wind projects entering into PPAs with all entities, including Distribution
Companies, for sale of power from solar and wind projects for
compliance of their renewable purchase obligation.
Provided further that the above waiver will be allowed only to those
solar and wind projects that are awarded through competitive bidding
process in accordance with the guidelines issued by the Central
Government.

5.0 This Order, irrespective of the purchasing entity, shall be applied

prospectively i.e. from the date of issue of Order.

4 Statement of Reasons to the 6th Amendment to the Sharing Regulations

 (6) Based on above discussions, following amendment is proposed for solar and
wind based generation:

.............................................................”

2.5. Comments have been received from Axis Energy Ventures India Private
limited, Indian Wind Energy Association, Indian Wind Power Association
(Andhra Pradesh and Telangana State Council), Indian Wind Turbine
Manufacture Association, Mytrah Energy, NALCO, MSEDCL and
TANGEDCO.
2.5.1. Indian Wind Energy Association has welcomed the proposed waiver of inter-
state transmission charges & losses for wind power projects.
2.5.2. Axis Energy, IWPA and IWTMA have submitted that as per clause 6.4(6) of the
National Tariff Policy (NTP), the policy seeks to extend the benefit of the waiver
of inter-State transmission charges and losses to both solar and wind sources
of energy using ISTS irrespective of mode of establishment i.e., either through
feed in tariff under Section 62 of the Electricity Act, 2003 or through competitive
bidding conducted under Section 63 of the said Act. Further, they have
submitted that the Govt. of India, Ministry of Power (MoP) has vide its letter no.
23/70/2017-R&R dated 5.4.2018 issued scheme on “Flexibility in Generation
and Scheduling of Thermal Power Stations to reduce emissions” which allows
generators having coal/lignite/gas based thermal generating stations with power
purchase agreements with DISCOMs to either generate or procure power from
renewable energy sources for meeting their RPO obligations. The Scheme also
provides that the power generated or procured by the thermal generators from
the renewable energy sources, located anywhere in the country, shall be
eligible for cross subsidies including waiver from ISTS transmission charges
and losses notified from time to time by the Government of India. They have
stated that the proposed draft Sixth Amendment to the Sharing Regulations in
its present form only permits solar and wind projects awarded through
competitive bidding process to avail waiver from ISTS transmission charges
and losses. If the proposed amendment is allowed in its present form it would
result in defeating the very purpose of the Scheme.

5 Statement of Reasons to the 6th Amendment to the Sharing Regulations

2.5.3. Indian Wind Energy Association (InWEA) has submitted that the proposed
requirement of competitive bidding should only be applicable for DISCOMs and
not to other entities. InWEA has further submitted that the waiver of Inter-State
Transmission charges and losses should be applicable for procurement of wind
energy by Captive Consumer or by third party under Open Access to meet their
RPOs provided competitive bidding route is followed by generator for
procurement of equipment. InWEA has sought clarification in respect of the use
of the term “competitive bidding” as to whether it means competitive bidding for
procurement of energy or competitive bidding by generator for procurement of
equipment. Further, as per the scheme on “Flexibility in Generation and
Scheduling of Thermal Power Stations to reduce emissions” issued by MoP,
power procurement under Section 62 of the Electricity Act, 2003 shall qualify for
such ISTS waiver. Therefore, the relevant proviso in the Draft Sixth Amendment
to the Sharing Regulations that restricts the waiver only for competitive bidding
may be deleted.

2.5.4. Mytrah Energy has submitted that the draft Amendment proposes that only
Wind & Solar Power Projects that declared CoD before 31.3.2022, would be
eligible for waiver of transmission charges and losses for the use of ISTS
network. WPDs(Wind Power Developers) require 21 months to commission the
Wind Power Project after issuance of LoA (18 months from signing of PPA) and
the same is also considered by SECI in its latest bid. In view of above, the
WPDs will face an uncertainty of applicable ISTS charges & losses even after
getting bid in the year of 2021. The consideration for waiver of ISTS charges
and losses at the time of bidding will be an additional risk for such
WPDs/bidders where the bids would be issued before 31.03.2022. Mytrah
Energy has requested to amend the Draft Amendment to allow the waiver of
ISTS charges and losses to all wind & solar projects which would be bidded
before 31.03.2022 instead of proposed commissioning before 31.03.2022.
Mytrah Energy has further submitted that there are many other windy sites
across the States where CTU connectivity is not available or are having
nearest STU connectivity, which is directly connected with ISTS network. In
case of direct connectivity to STU network, the bidders will have to bear State
charges & losses and there is possibility of further change in charges in future

6 Statement of Reasons to the 6th Amendment to the Sharing Regulations

 whereas there will be almost negligible charges & losses for the State network
and it will also support the use of high voltage unutlized sub-station of STU.
Mytrah Energy has requested the Commission to consider sub-station of STU
having direct connectivity with CTU as deemed ISTS and allow to waive-off
STU charges & Losses to the bidders who won the bids through competitive
bidding process.

2.5.5. NALCO has submitted that the term “competitive bidding” should be considered
as competitive bidding for procurement of equipment or for selection of
developer/contractor for setting up of wind/solar projects. Further, PPA
executed for captive consumption of power generated for wind/solar project
should also be considered for waiver of ISTS charges & losses.

2.5.6. MSEDCL has submitted that presently transmission line projects costing nearly
Rs. 57,000 crore are in progress & are proposed to be commissioned within
next 18 Months. Further, there are several transmission line projects in
progress or are proposed for evacuation of power from proposed & to be
proposed RE projects. After completion of all ongoing ISTS projects, YTC
(yearly transmission charges) would increase tremendously which will result in
further increase POC charges. Hence, detailed study is necessary to work out
impact of waiver of POC charges & losses for RE generation on POC charges,
after completion of all ongoing Transmission line projects (taking into
consideration approved Intra-State Transmission system). Further, the
possibility of funding of green corridor projects under PSDF scheme needs to
be explored.

2.5.7. TANGEDCO has submitted that many transmission assets have been created
exclusively for evacuation of power from the RE generating station. However,
there is no specific mention on the methodology to recover the cost of the
transmission assets created for the purpose of RE evacuation. At present, the
cost of these assets are included in the PoC pool, which socializes the huge
sunk cost. In reality, the entities / DISCOMs who are having tie up with the RE
generators to fulfil their RPO obligations are legitimately liable to pay the
transmission charges. But, the proposed waiver clause in the Draft Amendment

7 Statement of Reasons to the 6th Amendment to the Sharing Regulations

 relieves them from the burden of payment of transmission charges, whereas
the RE rich States are burdened with sharing of additional transmission charges
for fulfilling the obligations of the RPO deficit States. Also, the huge capacity
addition of RE generators causes uneconomic implications on DISCOMs on
account of managing the variability and intermittency. Further, must run status
to RE sources impose huge financial burden on the DISCOMs on account of
backing down of State owned thermal stations as well as other low cost
generating stations. In addition, the compensation mechanism imposed by the
Commission on account of operating the generating units at 55% Technical
minimum and reserve shut down of CGS has increased the financial liability of
the DISCOMs.

2.5.8. TANGEDCO has further submitted that in order to achieve the ambitious target
of the capacity of 175 GW of RE sources in the time frame of 2022 with the
support of the RE rich States, it is necessary to develop huge transmission
capacity to evacuate power from the RE sources. In this context, in order to
bring in transparency in planning and execution, it is essential to quantify the
RE capacity eligible for waiver of transmission charges or otherwise, it will pave
way for misuse of the provisions. Hence, it has become inevitable to conduct a
detailed impact assessment study by the designated planning agencies viz.
CTU/CEA and other committee/task force nominated by the Commission
featuring the following aspects:
(a) Transmission cost recovery methodology (the PoC mechanism does not
cater the need)
(b) Optimum utilization of existing transmission infrastructure
(c) Role and responsibility of RPO deficit states /entities
(d) Requirement for balancing resources by State entities,
(e) Incentives / benefits to host states.

2.5.9. TANGEDCO has further submitted that a Committee may be constituted to

conduct a comprehensive study and to analyse the technical & financial impact
of the Draft Amendment on the planning & operation of the ISTS, Intra-STS and
DISCOMs. The Committee may be directed to work on certain terms of
reference which may consider the following aspects

8 Statement of Reasons to the 6th Amendment to the Sharing Regulations

 (a) Pocket wise RE assessment report by the designated agencies
(b) RPO obligation of each State and present status of compliance assessment
of State wise requirement for RPO compliance
(c) Power System study to analyse the technical challenges which includes,
network adequacy, expansion requirement and system balancing
requirements (both interstate and intra state) in each time horizons of the
study based on the target implementation plan for RE generators.
(d) Financial viability study to accommodate the RE sources and the liability of
RE home States and the obligated States /entities

TANGEDCO has also submitted that a detailed procedure / methodology to

implement the waiver clause through the PoC mechanism should be devised
before notifying the proposed amendment.

2.6. Analysis and decision:

2.6.1. We have considered the comments given by stakeholders.
2.6.2. With regard to InWEA submission that whether the “Competitive Bidding” is for
procurement of energy or for competitive bidding by generator for procurement
of equipment, it is clarified that the notification dated 13.2.2018 specifies
competitive bidding process in accordance with the guidelines issued by
Central Government. Accordingly, the guidelines of Government of India in this
regard shall be considered.

2.6.3. Few stakeholders have submitted that the scheme on “Flexibility in Generation
and Scheduling of Thermal Power Stations to reduce emissions”, issued by the
Ministry of Power, Government of India vide its letter no. 23/70/2017-R&R
dated 05.04.2018 allows thermal generating stations with PPAs with DISCOMs
to either generate or procure power from renewable energy sources for meeting
their RPO obligations and that the power generated or procured by the thermal
generators from the renewable energy sources, located anywhere in the
country, shall be eligible for cross subsidies including waiver from ISTS
transmission charges and losses notified from time to time by the Government
of India. The relevant portion of the said notification dated 5.4.2018 is
reproduced as under:

9 Statement of Reasons to the 6th Amendment to the Sharing Regulations

 “D(iv) RPO/ RGO - Power which is generated from such renewable energy
shall be eligible for any cross subsidies notified by the Government from
time to time including waiver from ISTS transmission charges and losses as
per notification from the Government. Such renewable energy procured by
the beneficiaries shall qualify towards meeting their Renewable Purchase
Obligations (RPO obligations). Further, such renewable power in capacity
terms shall also qualify for Renewable Generation Obligations (RGO
obligations) for the generators as envisaged in the Tariff Policy and as and
when notified by Government of India.”

2.6.4. No such notification has been issued under Tariff Policy and the Commission
has thus not taken any view in this Amendment.

2.6.5. MSEDCL and TANGEDCO have submitted that many transmission assets have
been created for evacuation of power from renewable energy generating
station. However, there is no specific methodology to recover the cost of the
transmission assets created for the purpose of RE evacuation and the cost of
these assets are included in the PoC pool which socializes these cost.
Therefore, a detailed comprehensive study is required to analyse the impact of
waiver of POC charges & losses for RE generation on POC charges.
TANGEDCO has also submitted that a detailed procedure / methodology to
implement the waiver clause through the PoC mechanism should be devised
before notifying the proposed amendment. TANGEDCO has also submitted that
a Committee may be constituted to conduct a comprehensive study and
analyse the technical & financial impact on the planning & operation of the ISTS
and Intra-STS and DISCOMs which may consider the following aspects as
enumerated at paragraph 2.5.9.

2.6.6. Based on suggestion of some stakeholders, the Commission referred the

matter to Ministry of Power vide letter dated 19.7.2018. The letter reads as
under:

“2. The Commission initiated the process for 6th Amendment in the
CERC(Sharing of Inter-state Transmission System Charges and Losses)
Regulations, in accordance with the aforesaid letter seeking to allow waiver for
Wind and Solar Power Projects connected to ISTS network till 31.3.2022. This
is under process of finalization.

10 Statement of Reasons to the 6th Amendment to the Sharing Regulations

 3. It would be pertinent to mention here that during the public consultation
process of the proposed amendment to Regulations, the Commission has
received comments from various stakeholders voicing concerns over such
waiver and its impact on financial viability of the sector.

4. It has been contended that addition of huge transmission capacity to

evacuate RE power would have adverse impact on POC slab rates which
effectively will have to be borne by the Designated Inter-State Customers
(DICs) in the system. RE rich states will be burdened with sharing of additional
transmission charges for fulfilling the obligations of the RPO of deficit states.
Some stakeholders have recommended a detailed study to assess the impact
of such waiver in the system.

5. It remain a fact that in order to achieve the target of 160 GW of Wind and
Solar capacities by year 2022, huge transmission capacity for evacuation of
such power would require to be added in the system. The Commission feels
that a detailed study on impact of such waiver on the system would facilitate
informed decision about such waiver requirement.

7. With due regard to the objective of achieving high target of RE capacity

addition and with a view to addressing the concern shared by various
stakeholders, the Commission would also like to seek feedback from the
Ministry of Power on providing subsidy/grant to compensate waiver of
transmission charges for Wind and solar power projects connected to ISTS
network.

It would, therefore, be appreciated if comments of the Ministry of Power on the

issue highlighted above, be communicated to us at the earliest, before finalizing
amendments to the regulations. “

2.6.7. Based upon letter of CERC, the Ministry of Power took up the matter with
MNRE, CTU and other organisations.
2.6.8. MNRE vide letter dated 31.1.2019 has stated as under:-

“2. This Ministry‟s observation/comments on CERC‟s letter and PGCIL‟s

study report are as under:-

i) The waiver of ISTS charges is, in effect, socialization of cost

among the larger consumer framework, instead of being borne by
the purchase on the renewable power. The waiver will not result in
any revenue loss, PGCIL report has computed an increase of
Rs.0.12/kWh in the average transmission cost due to addition of
80 GW inter-state solar and wind capacity during 2019-22; this is

11 Statement of Reasons to the 6th Amendment to the Sharing Regulations

 in fact the socialized cost in lieu of the transmission charges that
would have been paid by inter-state renewable power purchaser;
ii) The calculations in the PGCIL report are erroneous. March 2018
transmission charges have been compared with that of March
2022 to suggest a 41% increase. Comparison to highlight the
difference can only be done between the two scenarios (i.e.
waiver and no waiver) in the same year. These apart, PGCIL in its
analysis has assumed that out of 100 GW capacity of solar and
wind to be installed between April, 2019 and March, 2022, 80 GW
will be under ISTS, this appears to be too high. The trends and
feedback from professionals suggests that ISTS component will
only be around 50-60% of the total capacity addition . Thus the
additional cost to be socialized would also reduce proportionately;
iii) With increase power demand, transmission infrastructure
development is bound to grow whether the new generation
capacity comes from renewables or conventional sources. Higher
transmission cost of solar and wind power is due to the lower CUF
of solar and wind power as compared to conventional power.
CERC‟s suggestion for providing subsidy/grant to compensate the
waiver is unfounded as this will go against the larger policy
direction of incentivizing renewables for their positive externalities.
A subsidy/grant would unnecessarily put unnecessarily put
financial burden on the government for an objective that can be
amicably met through socialization; and
iv) Waiver of ISTS charge on solar and wind capacity commissioned
upto March 2022 is largely perceived as a potent tool to
encourage setting up of the project in states that have greater
resources potential and availability of suitable land. It also helps in
creating a pan-India renewable power market, as generation is
excess of the state‟s own requirement could be transmitted to the
resource poor states without additional financial burden.

CERC has proposed draft 6th Amendment to the CERC(Sharing of

Inter-state Transmission System Charges and Losses) Regulations
to extend the waiver of ISTS charges and losses of wind and solar
generators in accordance with the Ministry of Power notification of
13.2.2018 (http;//www.cercind.gov.in/208/draft_reg/Noti27.pdf). The
CERC may be requested to finalize the draft 6th Amendment as
they have proposed vide the notification No. L-1/44/2010/CERC
dated 27.4.2018. “

2.6.9. Subsequently, Ministry of Power has replied to CERC letter dated 19.7.2018
vide letter dated 7.3.2019 as under:-

12 Statement of Reasons to the 6th Amendment to the Sharing Regulations

 “2. In view of the concern raised by CERC regarding waiver of ISTS charges
and losses for wind and solar generators, the Ministry of Power vide letter of
even number dated 2.8.2018 requested CTU to carry out a detailed study in
consultation with Central Electricity Authority to assess the impact of waiver of
ISTS charges and losses for wind and solar projects upto 31.3.2022 on
additional requirement of huge transmission capacity for evacuation of RE
power as well as financial viability of the sector.

3. MNRE was also requested vide OM dated 2.8.2018 to provide comments

on the issue of providing subsidy/grant to compensate waiver of transmission
charges for wind and solar power projects connected to ISTS network.

4. CTU/PGCIL vide letter dated 25.10.2018 submitted the report in

consultation with CEA. The report submitted by CTU is attached. Comments of
MNRE were also sought on the report of CTU.

5. MNRE vide OM NO.11/5/2019-EFM dated 31.3.2019 (enclosed) has

submitted comments on the concern raised by CERC on the issue of providing
subsidy/grant to compensate waiver of transmission charges for wind and solar
power projects connected to ISTS network as well as PGCIL‟s study report in
the matter. On the subsidy issue MNRE has stated that „CERC suggestion for
providing subsidy/grant to compensate the waiver is unfounded as this will go
against the larger policy direction of incentivizing renewable for their positive
externalities. A subsidy/grant would unnecessarily put financial burden on the
government for an objective tht can be amicably met through socialization.

6. Ministry of power vide order dated 30.9.2016 granted waiver of ISTS

charges and losses on transmission of electricity generated from solar and wind
resources of energy under para 6.4(6) of the Tariff Policy, 2016. But this waiver
is allowed only to those solar and wind projects that are awarded through
competitive bidding process. Thereafter, based on the request of MNRE, the
Ministry of Power vide order dated 13.2.2018 has extended the waiver of ISTS
charges and losses for solar and wind power projects till 31.3.2022. However,
this waiver was made available for solar and wind power projects entering into
PPAs with all entities, including Distribution Companies, for sale of power from
solar and wind power projects for companies of their RPO. Further, this ISTS
charges waiver is available to solar and wind projects awarded through
competitive bidding as per guidelines issued by the Central Government.

7. Considering the report of CTU and views of MNRE the Central Commission
is requested to carry out suitable changes in the relevant Regulations to
implement the Ministry of Power order dated 13.2.2018 for waiver of ISTS
charges for solar and wind power projects till 31.3.2022.”

13 Statement of Reasons to the 6th Amendment to the Sharing Regulations

2.6.10. Based upon letters of MNRE and Ministry of Power, the Draft Amendment is
being finalized. Other issues in paragraph 2.6.5 are beyond the scope of the
Draft Amendment proposed.

2.6.11. As regards the suggestion of Mytrah Energy to amend the proposed regulation
to allow the waiver of ISTS charges and losses to all wind & solar projects
which to be bidded before 31.03.2022 instead of commissioned before
31.03.2022, we are of the view that the Draft Amendment has been proposed in
view of the policy of the Government of India, Ministry of Power and the
suggestion by the stakeholder is not in line with the said policy.

2.6.12. Further, with regard to Mytrah Energy suggestion to consider sub-station of

STU having direct connectivity with CTU as deemed ISTS, we are of the view
that the suggestion is beyond the scope of the proposed Draft Amendment.

2.6.13. MSEDCL has suggested that presently transmission projects costing nearly Rs.
57,000 crore are in progress & are proposed to be commissioned within next 18
Months. Further, there are several transmission projects in progress or are
proposed for evacuation of power from proposed & to be proposed RE projects.
MSEDCL has requested to consider funding of green corridor projects under
PSDF scheme. MSEDCL may take up the issue with the Govt. for funding from
PSDF scheme.

2.6.14. The Sharing Regulation was proposed to be amended as per MoP Order
issued vide order No. 23/12/2016/R&R dated 13th February, 2018 under
amended Tariff Policy.

2.6.15. Since, MoP has notified the said notification for ISTS charges and losses
waiver for generation based on solar and wind resources on 13.2.2018, the
amended Regulation has been made effective from date of notification of Order
by MoP i.e. 13.2.2018.
2.6.16. The Sharing Regulations already has a provision of waiver of ISTS charges and
losses for solar based projects commissioned/ to be commissioned between

14 Statement of Reasons to the 6th Amendment to the Sharing Regulations

 1.7.2017 and 31.12.2019 and for wind based projects commissioned/ to be
commissioned between 30.9.2016 and 31.3.2019. Since, MoP order dated
13.2.2018 would be effective from date of notification of Order by MoP i.e.
13.2.2018, the date “31.12.2019” in sub clause (y) to Clause (1) of Regulation 7
shall be substituted with the date “12.2.2018” and the date “31.3.2019” in sub
clause (z) to Clause (1) of Regulation 7 shall be substituted with the date
“12.2.2018”.

2.7. Based on above discussions, following amendment is effected to in the

Sharing Regulations:
(1) In sub-clause (y) to Clause (1) of Regulation 7, the date “31.12.2019” shall
be substituted with the date “12.2.2018”.

(2) In sub-clause (z) to Clause (1) of Regulation 7, the date “31.12.2019” shall
be substituted with the date “12.2.2018”.

(3) A new sub-clause (aa) to Clause (1) of Regulation 7 of Principal Regulations

shall be added as under:-
“(aa) No transmission charges and losses for the use of ISTS network shall
be payable for the generation based on solar and wind power resources
for a period of 25 years from the date of commercial operation of such
generation projects if they fulfill the following conditions:

(i) Such generation capacity has been awarded through competitive

bidding process in accordance with the guidelines issued by the
Central Government;
(ii) Such generation capacity has been declared under commercial
operation between 13.2.2018 till 31.3.2022;
(iii) Power Purchase Agreement(s) have been executed for sale of such
generation capacity to all entities including Distribution Companies
for compliance of their renewable purchase obligations.”

sd/- sd/- sd/-

(I.S.Jha) (Dr.M.K. Iyer) (P.K. Pujari)
Member Member Chairperson

15 Statement of Reasons to the 6th Amendment to the Sharing Regulations

 Appendix-I

List of Stakeholders submitted written Comments/Suggestions

Sl. No. Name of Stakeholder

1. Axis Energy Ventures India Private limited
2. Indian Wind Energy Association (InWEA)
3. Indian Wind Power Association (IWPA)
4. Indian Wind Turbine Manufacture Association (IWTMA)
5. MSEDCL
6. Mytrah Energy
7. NALCO
8. TANGEDCO

16 Statement of Reasons to the 6th Amendment to the Sharing Regulations